Ahead of and during our Annual General Meeting we gave members the opportunity to ask a question directly to our Board of Directors and receive a response. Please see this year’s questions and responses below.
Q What progress has the Society made towards members being able to make transfers from their Society account(s) direct to their bank accounts?
A The Society is planning significant steps in its Digital Strategy and is currently finalising a market review of the options which will be presented to the Board in March and April. Options under consideration are for online services that can be utilised on devices including laptops, tablets and also mobile phones using an app.
Transfer of funds between a Hinckley & Rugby Building Society savings account and a nominated bank account is part of the functionality included in this piece of work. It is considered important for the members to have the efficiency and effectiveness that digital technology brings.
Q What is the ratio of the highest to lowest paid employees of the Society (or to the median rate of pay)?
A The highest to lowest ratio of pay is 1:14.02
The median rate of pay ratio is 1:8.1
Broken down into the number of employees; 108 employees are below the median rate and 36 employees are above the median rate
Q What average percentage pay rise was awarded to Executives in the year? What average percentage pay rise was awarded to other staff?
A The 2020/2021 pay rise awarded across the board to all staff members and Executives was 1%.
The accrued annual pay rise pot was 2.25%. Following a benchmarking exercise carried out during the year, a strategic proposal was agreed by the Remuneration Committee and the Board to divert 1.25% of the available pot to increase the salaries of the lowest paid job roles. The objective by the end of March 2021 is to increase the salaries of everyone to the lower quartile rate, subject to performance criteria.
Q With the reduction of interest rates and lower profit before tax compared with 2019, how can the Remuneration Committee justify the salary increase to Colin Fyfe. The financial performance is a mixed bag and it is easy to blame the impact on Covid, which I am not minimising its major effect on the business organisation. I accept as your CFO says that “the Society is not aiming to maximise profit for shareholder gain” etc. but more perhaps should be done in areas like directors’ remuneration and other emoluments in these current difficult times.
A With an unprecedentedly low Bank of England base rate of 0.1%, the Society needs to remain relevant and competitive. The Society has endeavoured to be as fair as possible to both the saving and borrowing members.
The salary for Colin Fyfe declared in the Annual Report and Accounts is inclusive of a 9% cash pension contribution. In 2019/2020 Colin Fyfe’s salary increase was 2.25%, the same pay rise awarded across the board to all staff and Executives.
There is not a significant bonus culture within the Society, which is absolutely as it should be. Of the six members of the Senior Management team, five members received higher bonuses than the three Executive Directors. This is a powerful cultural message of the value of the Society’s Senior Management team.
Following a proposal made by Colin Fyfe for a “thank you” payment to all employees for their tremendous effort over the last twelve months, the Board agreed an amount of £200 for every employee to be paid in their December pay. Colin Fyfe did not receive this payment.
Q Thanks for the info on future internet banking possibilities for transferring money from Hinckley & Rugby Building Society accounts to a nominated bank account. It seems that to have this facility the Society forces members to go online. The Nationwide (which I agree is huge and starting to operate more like a bank all the time), the Coventry Building Society and Rugby Credit Union (which is comparatively tiny) all have a facility for members to walk into a branch and ask for money to be sent to their bank. I’m disappointed this seems not to be in prospect for the Society’s members.
A We are looking at our Digital Strategy and the opportunities this will bring to our members. In the future we may be able to accommodate the facility to transfer funds between a Hinckley & Rugby Building Society savings account and a nominated bank account within our branch network.